Market Research Report
Based on the parameters below, we project this business would break even in 1.9 years with a net present value of $691,573.
Net Cash Flow over 5 years
|Year 0||Year 1||Year 2||Year 3||Year 4||Year 5|
|Net Operating Profits||$97,437||$146,156||$194,874||$206,601||$219,033|
|Net Cash Flow||-$185,520||$97,437||$146,156||$194,874||$206,601||$876,133|
Startup costs are estimated as the larger of PYE and median income multiplied by the cost of living in the city. The positive cash flows in years 1 to 5 are estimated from the PYE. The first year is discounted by 50%, the second year is discounted by 75%, the fourth through tenth years are inflated according to a growth rate estimated from the GDP growth rate of the state. The profit margin is defaulted 10%. In year 5 a “terminal value” equal to the year 5 net operating income times three is added. The hurdle rate is defaulted to 15%. All values are net of taxes.
How is this opportunity calculated?
The following ten market factors are the most important determinants used to calculate the need for businesses of this type in Frisco.
- median income
- gross rent
- population density
- July temperature
- household size
- November temperature
- land area
- family households
- May temperature
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About Frisco and its Consumers
Frisco is a city located in Collin and Denton counties in Texas. It is part of the Dallas-Fort Worth metroplex, and is located approximately 25 minutes from the DFW Airport and Dallas Love Field Airport. With major highways north-south and east-west, the city is well-positioned on the path of growth in the Dallas area. As of June 1, 2014, the city had a population estimated at 140,220. Frisco was the fastest-growing city in the United States in 2009,and also the fastest-growing city in the nation from 2000 to 2009. In the late 1990s, the northern DallasFort Worth Metroplex suburban development tide hit the northern border of Plano and spilled into Frisco, sparking explosive growth into the 2000s. Like many of the cities located in the booming northern suburbs of Dallas, Frisco serves as a bedroom community for many professionals who work in the DallasFort Worth Metroplex. Since 2003, Frisco has received the designation "Tree City USA" by the National Arbor Day Foundation.
Frisco is a city located in Collin and Denton counties in Texas. It is part of the Dallas-Fort Worth metroplex, and is located approximately 25 minutes from the DFW Airport and Dallas Love Field Airport. With major highways north-south and east-west, the city is well-positioned on the path of growth in the Dallas area. As of June 1, 2014, the city had a population estimated at 140,220. Frisco...description source
Population Population (2012) 128,176 Population Density 2,073 ppl/sq mi Population Growth Rate 9.6% Median Income $106,232 Median Age 34.3 Unemployment 5.0% Family Household Percent 78.3% Avg. Household Size 2.9 Avg. House Price $234,900 Foreign Born 10.9% Married 20.3% Cost of Living 49.9%
Demographics White 67.2% Hispanic / Latino 12.1% Black / African American 7.8% Asian 9.9% Native American 0.4%
Market & Regulatory Conditions For Texas
Third parties rate Texas's business and regulatory conditions according to their own methods. We report them here for informational purposes.
Small-Business Friendliness Overall small business friendliness A+ Ease of starting a small business A Cost of hiring a new employee B+ Overall regulatory friendliness A Friendliness of health and safety regulations A- Friendliness of employment, labor, and hiring regulations A Friendliness of tax code A Friendliness of licensing regulations A Friendliness of environmental regulations A- Friendliness of zoning regulations A Publicity of training programs C+ Publicity of networking programs C Current economic health of small business 13th/50 Change in revenue over past 12 months 29th/50 Forecast of small business's future economic health 17th/50Source: Thumbtack.com (2012)
Business Friendliness Overall Business Friendliness 2th/50 Cost of Doing Business 23th/50 Economy 1th/50 Infrastructure 1th/50 Workforce 11th/50 Quality of life 37th/50 Technology and innovation 2th/50 Business friendliness 20th/50 Education 27th/50 Cost of living 18th/50 Access to capital 5th/50Source: CNBC (2014)
Tax Friendliness Texas Corporate Tax Rate 6.3% Avg Local Corporate Tax Rate in Texas 1.9% Avg Combined Corporate Tax Rate 8.2% Overall tax friendliness 10th/50 Corporate tax rank 39th/50 Individual income tax rank 6th/50 Sales tax rank 36th/50 Unemployment insurance tax rank 15th/50 Property tax rank 36th/50Source: Tax Foundation (2015)
Resources to Get Started
Now that you have a potential location and idea for your business, here is a list of helpful resources you may need to get started.